Monday, April 29, 2013

National

RBI: interest rate cuts
Apex bank leaves India Inc. disappointed
Seems that the stalled growth engine of India Inc. will have to wait for some time more before it gets some further rev ups. In its latest review of monetary policy, the RBI decided to keep benchmark interest rates and cash reserve ratios unchanged, leaving many market participants and analysts crestfallen as they were hoping for further cut in policy rates. On the contrary, the central bank warned that reducing key policy rates at this juncture could accelerate inflation rather than spur growth. This stand of RBI is in divergence with its earlier stated policy of bringing down the interest rate if core inflation is below 5% (core inflation was hovering around 4.9% at the time of the announcement.) Currently, repo rate (the rate at which RBI lends funds to other banks) and cash reserve ratio are at 8% and 4.75% respectively. However, RBI has increased the limit of export credit refinance from 15% of outstanding export credit of banks to 50%, which will potentially release an additional liquidity of over Rs.300 billion, equivalent to about 50 basis points reduction in the CRR. But RBI’s stance is going to baffle foreign investors no end. After a span of two years, even China has now started to reduce its interest rates in an attempt to boost the economy. Brazil, another member of the BRICS club, has also been cutting its key policy rates for quite some time. Even a recent report of rating agency Moody’s has said that India could turn out to be the weakest amongst all BRICS countries.

Oil: high diesel demand
Private refiners make hay
Due to the huge difference in the prices of diesel and petrol, the demand for diesel in the country has shot up. So much so that demand outstrips supply by a wide margin. Demand for diesel has skyrocketed and exceeds supply because of petrol prices, which is 70% costlier than diesel. As a result, PSU oil refiners have been forced to buy diesel from Reliance Industries Ltd and Essar Oil. State run oil firms like Hindustan Petroleum, Indian Oil and Bharat Petroleum are buying nearly 15 million tonnes of diesel per year from the two private refiners. Essar Oil operates 1,391 operational outlets, including 249 under construction. Reliance has about 700 operating outlets. The private refiners are able to charge diesel at international prices from the PSU refiners leading to huge windfall gains for the former. On the contrary, state firms are suffering a revenue loss of Rs.10.20 per litre of diesel they sell in the retail market. IOC, India’s biggest oil refiner with a capacity to process 66 MT crude oil, annually bought about 42% diesel from other domestic refiners in the first two months of the current financial year. The company produced 4,485.4 thousand metric tonne diesel in first two months of the current financial year against a sale of 6,371.2 TMT in the same period. According to oil ministry’s data keeper, Petroleum Planning and Analysis Cell, while petroleum consumption recorded monthly growth at 0.2% in April (lowest in the last one-and-half years), about 47% of total consumption in that month was of diesel. “This is one strong indicator of dieselisation of the economy due to price distortion among competing fuels,” PPAC said in its latest report. Diesel rates in the country are frozen since June 2011. It is sold at Rs.41.29 a litre in Delhi while petrol costs Rs.70.24 a litre in the metro.


Source : IIPM Editorial, 2013.
An Initiative of IIPM, Malay Chaudhuri
For More IIPM Info, Visit below mentioned IIPM articles
 
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Saturday, April 27, 2013

Meet the enemy of the internet – Facebook!

We all know Facebook as the dorm room idea that popped out of no where and changed the world. And recently bombed at the bourses. But then, there’s also the counter argument...

Before I explain how, let me first give you a quick background about why Facebook is in a position to threaten the internet.
 The story behind the network
Till about the rise of online media as a means to access news, print, radio and television were the only options. But soon, Google came along and mainstream media was no longer the only gatekeeper of news, It was a great way to express oneself and anyone was free to post anything anywhere on the internet, My blog is an example of the same. Most of the online content was relevantly available through search giant Google. With the rise of social networks, the concept of sharing came into prominence. Twitter and Facebook bring news straight into our News Feeds and we do not have to go anywhere else searching for news.

If it is not shared on Facebook it does not exist! While Twitter still remains a niche network with a small percentage of active users who make all the noise, the dominance of Facebook has been so overwhelming that almost everyone we directly know is a member there, and quite active too. Apart from this, we have celebrities and brands who keep long for us to ‘LIKE’ their pages on Facebook at the expense of their own official websites. Facebook pages are far more attractive to them because that is where all the people are. In due course of time Facebook has become not just another website but the Internet for many

This places Facebook in a position of great power. As such, we expect Facebook to act with maturity as people depend on it to bring them the news. Instead, it is slowly turning out to be a very smart villain and with the IPO money, things can get really bad. Therefore, the focus of this piece is on Facebook, on how it treats ‘The Internet’ as its arch enemy, and why we should be concerned about it. When I say ‘The Internet’ I mean the internet that exists outside the walls of Facebook.

But isn’t it nice to use Facebook to access content from all across the web, shared by our friends and pages that we like, all in one News Feed? Why should we be bothered about the rest of the internet? Here’s why. Facebook hides more stuff than it shows! At any given time, the News Feed shows only a small percentage of all content that is shared by our friends and Pages that we like. If we try and change the settings to show Most Recent posts, we might find few more updates, but still, a huge percentage of updates are hidden from us. That also means, whenever we post status updates, they reach only a small percentage of our friends. Facebook itself has said that the reach is around 12% to 16% of total friends. Beat that, more than 84% of our friends don’t even see what we are sharing or talking about even when we are online at the same time! Isn’t this a violation of our fundamental right to speech? Shouldn’t we be deciding whose updates we need to see in our news feeds and shouldn’t our voice be heard by our friends?

Facebook says that it does it to control noise in the News Feed. Too many updates can inundate the users feed, so Facebook devised an ultra sophisticated mechanism that reads our minds (It always asks “What’s on your mind”, so that it knows) and shows us what it thinks is appropriate and relevant to us.


Source : IIPM Editorial, 2013.
An Initiative of IIPM, Malay Chaudhuri
For More IIPM Info, Visit below mentioned IIPM articles
 
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Thursday, April 25, 2013

Intel inside, arm outside!

When Intel Chief Paul Otellini announced that his company had secured the commitment of Lenovo and Motorola Mobility to put ‘Intel Inside’, it was considered as a significant development in the computing world. But the launch of Intel’s first processor in Lava’s XOLO X900 instead was a bit of a dampener. B&E looks into Intel’s strategy and attempts to dig out the chip maker’s odds of succeeding in the smartphone segment

The funny thing about most great corporations is the fact that they are great only for a limited period of time. The greatness stays around for one generation and might even extend to two generations. But the moment they begin taking market forces and technological change for granted – they lose their cutting edge and eventually their greatness. This is the very reason why Microsoft – a company once referred to as the 1000 pound gorilla of the computing industry – doesn’t quite ring that loud a bell today.

The time when powerful – and cash rich – companies could afford to ignore external forces is long over. So when the Santa Clara based semiconductor giant Intel announced that Lenovo and Motorola will have ‘Intel Inside’ their smartphones at the Consumer Electronics Show in January this year, the news made headlines but was hardly surprising. It was about time that Intel made a move into the smartphone market, dominated by chips using designs from ARM of Cambridge.

Consider a few statistics. According to data complied by research firm IDC, 491 million (almost half a billion) smartphones were activated in 2011 – a 61.3% increase over 2010. Samsung, Apple, Nokia, RIM and HTC shipped 94 million, 93.2 million, 77.3 million, 51.1 million and 43.5 million units respectively. The remaining 132.3 million smartphones were sold by players like Sony, LG, et al. How many of these carried an Intel processor? Not even one! Although Intel remains the undisputed supplier to PC manufacturers globally, this market grew by a mere 1.8% last year.

Under these circumstances, the chip major’s interest in smartphones was palpable. And then came the big dampener in the form of Lava’s XOLO X900 powered by an Intel Atom Z2460. At a time when investors and analysts were expecting an Intel equipped Motorola or Lenovo handset, Intel chose to debut in the smartphone category with a lesser known Indian brand. The Intel powered Lava smartphone is impressive no doubt. Even if the processor is not a dual core or a quad core, Intel’s 1.6 GHz CPU with Hyper Threading allows for an exceptional multitasking experience while promising a battery life comparable to competing smartphones. But here’s the catch. It’s priced at Rs.22,000. No matter how well packaged the smartphone is, Indian consumers will hesitate to invest that kind of money when they have an option to go for a Samsung, HTC or Nokia smartphone. The association with Lava therefore appears to be nothing more than a pilot test for the Atom Z2460. That the stock market did not react to the development (Intel’s share price in fact fell by a few percentage points) indicates that investors did not see this launch as a major breakthrough for the chip major.

So, despite extensive expertise in developing processors, why is Intel having such a hard time replicating it’s PC success with smartphones? The answer lies in the architecture. While you have an entire motherboard on a PC which can accommodate everything from Graphic Processing Units (GPUs) to peripherals, all these have to be put on to a single chip (SoC – System-on-a-Chip) in a smartphone. The technology to make this integration possible has been developed by ARM Holdings – a British multinational with revenues of roughly $772 million – which licences it to ecosystem partners like Qualcomm, NVIDIA, Samsung and Texas Instruments.


Source : IIPM Editorial, 2013.
An Initiative of IIPM, Malay Chaudhuri
For More IIPM Info, Visit below mentioned IIPM articles
 
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Wednesday, April 24, 2013

“True entrepreneurs don’t start rich”

Stephan Gary Wozniak, Co-founder of Apple Inc., in an exclusive interview with B&E talks about the notable traits of successful entrepreneurs, and how he rates the late Steve Jobs as an entrepreneur-leader

B&E: How do you define “entrepreneurship”, since you were key to creating Apple as a company, and what prime qualities should an entrepreneur possess?
Steve Wozniak (SW): I don’t have a good definition of entrepreneur. I’d go with the popular opinion. It’s usually a young person but could be an older person who is young at heart. It’s a person who wants to start a company and get going on his or her life toward making a lot of money.

B&E: How critical is passion as a success factor for an entrepreneur to succeed?
SW: Some entrepreneurs are motivated by passion to do a particular thing. Others just want any opportunity to have a business of their own. They all want to, at least partly, escape from working for others on this project. Usually entrepreneurship involves creation and engineering. Bright engineers get ideas and become entrepreneurs to bring them to fruit. Often an engineer or scientist creates some sort of working model in their home or garage first.

B&E: And what do you have to say about young graduates who make a mark in the world of entrepreneurship?
SW: These days many graduate from college with entrepreneurship training and they look for ideas or come up with ideas with little or no understanding of what it will take or if it’s possible. They assume that once they get funding for an idea on paper they can find engineering as a resource anywhere in the world. This is the business graduate. The best is when both disciplines, engineering (science) and business, are in the same person.

B&E: How would you rate the late Steve Jobs as an entrepreneur and what were his top qualities (and weakness, if at all) as an entrepreneur and a leader?
SW: Steve was one of the greatest. He didn’t do the engineering but he understood it better than pure business types. He always recognised the importance of it and hired the greatest engineers. I was his key in the early days but he did not make a mistake. In later times it was clear that he understood the importance of all the departments of a large company and insisted on hiring some of the best people in the world in every one of these departments.

B&E: So you say that for Steve Jobs, being around engineers helped him emerge as a successful CEO-leader?
SW: When Steve was young he had a huge spirit to form a company as a way to bring his great ideas to the world. He thought fast and had ideas about everything and he was very outgoing about it. He was around a lot of engineers and knew when gold had struck, with the Apple II.

Source : IIPM Editorial, 2013.
An Initiative of IIPM, Malay Chaudhuri
 
For More IIPM Info, Visit below mentioned IIPM articles
 
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Monday, April 22, 2013

B&E Annual CEO Report 2012-13 results*

Why CEOs do what they do

Methodology

In 2011, NYSE Euronext commissioned the NYSE Euronext CEO Report, the seventh annual CEO survey. The survey ascertained expectations of respondents on various business and economic conditions. 317 NYSE CEOs, 119 emerging CEOs of US non-public companies, 205 MBA students were covered in the research report.

Based on the NYSE Euronext CEO Report, the Indian Council for Market Research (ICMR) with research support from the IIPM Think Tank conducted a nation-wide survey amongst CEOs and top managers for both listed and unlisted/emerging companies from India Inc., apart from MBA students. Responses were taken via face to face/telephonic/e-mail interactions, and the survey generated 100 responses from CEOs/top management executives of Indian-listed companies, 100 CEOs/top management executives of unlisted companies and 300 Indian MBA students.

With exclusive permission from NYSE-Euronext and IIPM Think Tank-ICMR, Business & Economy presents the B&E Annual CEO Survey 2012-13, comparing business and economic sentiments of CEOs/top management and MBA students in the US and India.


Source : IIPM Editorial, 2013.
An Initiative of IIPM, Malay Chaudhuri
For More IIPM Info, Visit below mentioned IIPM articles
 
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Friday, April 19, 2013

When push comes to shove

Sales figures for november saw HMSI stage a quiet coup in the domestic two-wheeler market as TVS Motor was edged out of its number three perch. Can it claw its way back?
 
Appearances can be deceptive. They may conceal more than what they reveal. At first blush, the Chennai-based $2.2-billion TVS Motor Company’s 7.79% growth for the month of November 2011, in which it sold 1,50,406 two-wheelers, appears to be a fairly good showing, all the more so considering the macroeconomic challenges and the overall poor market sentiment in the Indian market. However, one only needs to look a bit deeper to arrive at a fuller picture. During the festive month of November, the two-wheeler industry grew by 25.27% and its (TVS) arch rivals like Hero MotoCorp and Honda Motorcycle & Scooters India (HMSI) managed to beat the industry trend by registering top-line growth of 27.28% and 59.04% respectively. For TVS, worse was yet to come. The month also saw it ceding its No. 3 slot in the two-wheeler market to HMSI, whose November sales logged 189,970 units.

Sure, the figures are for just the month of November. For the two contenders, the scales of fortune could tip either’s way and there could well be many a slip betwixt the cup and lip in the months ahead. For the past few years and till as late as November 2011, TVS was the third-largest two-wheeler manufacturer with a market share of 14.5%. The company sold 1,282,117 units as compared to the 1,228,987 units sold by HMSI during the April-November period. But the latest coup by HMSI has set tongues wagging. Will TVS be able to claw back the lost ground in the Indian two-wheeler market going ahead?

An e-mail sent to TVS Motor Company for its comments on this story did not elicit any response. But it is worth mentioning here that in October 2009, Business & Economy did a story discussing the fight for the #3 slot in the Indian two-wheeler industry between TVS and HMSI. As far back as two years ago, the magazine made a prediction that has come to be almost prophetic in hindsight. The story in question strongly made a case for TVS to pull up its socks or suffer the fate of watching HMSI vroom ahead. That fate has now come to haunt TVS. Considering the pace that HMSI has picked up of late, TVS will need to pull off a visceral performance and push sales aggressively to come back into the game with its honour intact.

Venu Srinivasan, the Chairman and Managing Director of TVS Motor Company, is not new to facing challenges. In fact, he has a reputation for thriving when the going gets tough. As a student of business management at Purdue University in the US, he spent a summer hawking the Good Book Bible in North Carolina. Despite being the grandson of the founder of the group (T.V. Sundaram Iyengar), Srinivasan started his career with the group as a grunt mechanic and put in a lot of elbow grease before moving up the ladder and becoming the CEO of Sundaram-Clayton (a TVS Group company) in 1979. And it was not before the mid-1980s that he rose to the top and was calling the shots at the two-wheeler manufacturer.


Source : IIPM Editorial, 2012.
An Initiative of IIPM, Malay Chaudhuri
For More IIPM Info, Visit below mentioned IIPM articles
 
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Tuesday, April 16, 2013

“Egypt has undergone a sea change after the revolution”

Adel el Masry, Director of Egypt Tourism Authority, is upbeat on his country’s tourism prospects, which had taken a hit following the political uprising in the country. In an exclusive interaction with b&e’s Dipshikha Das, Masry talks about how Egypt’s tourism is back on its feet and what his country is doing to promote tourism

B&E: The political turmoil caused by the Arab Spring, the subsequent fall of the Hosni Mubarak regime and the current fragile state of affairs in Egypt have taken a heavy toll on tourism in the country. What are you doing to help it bounce back?
Adel Masry (AM): Tourism to Egypt is returning to stability after a long movement for political democracy. Egypt is receiving immense support from several nations who are helping improve the situation by lifting travel advisories against Egypt. The Egypt Tourism office in India is aggressively taking part in all important trade fairs and travel expos for giving maximum exposure to and showcasing the country’s tourism industry to the entire South-east Asia market.

B&E: In the Egypt tourism’s scheme of things, where does India fit in?
AM: Tourism is an important driver of our economy and the annual growth in this sector has risen to around 30%. Last year we received 16 million tourists, and earned around $11,000 million. Currently tourism contributes approximately 11.8% to Egypt’s GDP. In 2009, we had 87,000 Indian tourists and, in 2010, it stood at 1,14,000, up 36% against the previous year. We are expecting at least a 35% increase by the end of this year.

B&E: After the turmoil that your country has been through, how difficult do you think it would be to lure foreign tourists to Egypt?
AM: It’s true that we suffered a huge loss in terms of tourist flows from Asia and elsewhere in the wake of the people’s movement that Egypt faced. However, we have been taking steps to lure the Indian tourists back. We have doubled our tourism promotion budget in India from a half million dollars to $1million in the current year. We are aggressively targeting Indian tourists in cities like Mumbai, Delhi, Ahmedabad, Bangalore, Kolkata, Chennai and Jaipur. But it’s not just the big cities but also the tier II cities we are looking at now. We have adopted an experimental marketing approach by organising tours for our travel partners to witness the destination in the aftermath of the political unrest and see for themselves that Egypt is now once again as safe and secure for tourists as it has always been in the past. Also, we have increased the limit on baggage allowance for tourists travelling through Egypt Air as well as increased the frequency of our flights to five days in a week from Mumbai to Cairo and vice versa. Post the movement in Egypt, the “Tahrir Square in Cairo” has generated a lot of interest for people to see and visit the place since it was the epicentre of all activities during the movement. We had recently organised FAM trips for the Indian media to witness and see how Egypt has undergone a change after the democratic movement. Also, to raise our profile in India, we have participated at important tourism events like SATTE in Delhi, TTF & OTM in Mumbai, and the recently held PATA travel mart in Delhi.


Source : IIPM Editorial, 2012.
An Initiative of IIPM, Malay Chaudhuri
 
For More IIPM Info, Visit below mentioned IIPM articles
 
2012 : DNA National B-School Survey 2012
Ranked 1st in International Exposure (ahead of all the IIMs)
Ranked 6th Overall
Zee Business Best B-School Survey 2012
Prof. Arindam Chaudhuri’s Session at IMA Indore
IIPM IN FINANCIAL TIMES, UK. FEATURE OF THE WEEK
IIPM strong hold on Placement : 10000 Students Placed in last 5 year
IIPM’s Management Consulting Arm-Planman Consulting
Professor Arindam Chaudhuri – A Man For The Society….
IIPM: Indian Institute of Planning and Management
IIPM makes business education truly global
Management Guru Arindam Chaudhuri
Rajita Chaudhuri-The New Age Woman
IIPM B-School Facebook Page
IIPM Global Exposure
IIPM Best B School India
IIPM B-School Detail
IIPM Links
IIPM : The B-School with a Human Face
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Monday, April 15, 2013

Making sense of the incorrigibly Cognizant!

Cognizant’s ability to consistently achieve astronomical revenue growth has surprised many. Will it’s new strategic outlook be able to keep the ‘shock & awe’ coming?

While debating on a particular strategy related to employee & customer orientation in a technology company with a top CEO, I gave the logic that works best when you are trying to escape an argument – the proof of the pudding is in the eating, and the particular company was doing well. The CEO smiled at me and nodded his head, saying that even the most unconventional strategy looks great when someone successfully applies it. The whole world then analyses why the strategy worked for that unique organisation and feel we have got collectively smarter through the entire process. The fact is, perhaps that next time too, we will only identify the merits of an unconventional strategy when it has met the benchmarks of success.

Though Cognizant is not the company I was discussing, there is no doubt that the successful rise of this company which has become the flavour of the season in the IT space. Cognizant, which beat Wipro in terms of revenues to reach the number 3 position among Indian IT players in the quarter, saw revenue rise by 34.4% yoy to reach $1.48 billion and net income reach $208 million, a growth of 20.78% yoy. And the surprising part is that IT experts weren’t really counting on the company delivering these numbers, as it still got 77.8% of its revenues from North America, a region that the IT world is looking to slowly derisk from. Annually, the company is showing a growth of 40% on an average over the past five years, which also include the recessionary phase. It makes sense to understand what makes the company stand amidst this environment, and whether the growth is indeed sustainable.

There were a number of things that Cognizant, a relatively young upstart did that made it different from its peers since it commenced operations in 1994 as the IT development and maintenance services arm of Dun & Bradstreet. The first was its initiative to shift headquarters to the US within two years of commencement of operations and ensured that its top management was where its clients were. Linked to this decision, it also pioneered and trademarked the ‘Two-in-a-box model’, which combined the global delivery model with the relationship manager onsite to give clients a differentiated service experience.

Cognizant is extremely dependent on employees in India, which account for over 75% of the workforce. In that sense, it ensured an effective utilisation of both worlds, and other Indian companies, even though their business is also largely driven by US and Europe, developed a global positioning much later. In fact, Cognizant is also lobbying for change in H1B visa norms, and CEO Francisco said at the CEO Council recently on outdated immigration laws, “Millions of foreign skilled professionals are in legal limbo due to a massive backlog for permanent resident visas, hampering their ability to fully contribute to the US economy & discouraging talented foreign professionals to consider working or starting a new business in US.”


Source : IIPM Editorial, 2012.
An Initiative of IIPM, Malay Chaudhuri
 
For More IIPM Info, Visit below mentioned IIPM articles
 
2012 : DNA National B-School Survey 2012
Ranked 1st in International Exposure (ahead of all the IIMs)
Ranked 6th Overall
Zee Business Best B-School Survey 2012
Prof. Arindam Chaudhuri’s Session at IMA Indore
IIPM IN FINANCIAL TIMES, UK. FEATURE OF THE WEEK
IIPM strong hold on Placement : 10000 Students Placed in last 5 year
IIPM’s Management Consulting Arm-Planman Consulting
Professor Arindam Chaudhuri – A Man For The Society….
IIPM: Indian Institute of Planning and Management
IIPM makes business education truly global
Management Guru Arindam Chaudhuri
Rajita Chaudhuri-The New Age Woman
IIPM B-School Facebook Page
IIPM Global Exposure
IIPM Best B School India
IIPM B-School Detail
IIPM Links
IIPM : The B-School with a Human Face
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Saturday, April 13, 2013

Will Indian Online travel Boom invite M&As?

The Indian Online Travel Industry has witnessed tremendous growth since 2004. Today, it’s the most Crowded space in The E-Commerce Segment with new players joining The Race every year. Question is – how will this Overcrowded space grow spacious?

As more and more Indians turn to the web for their travel needs, the online travel portal market in the country is gearing up for a bigger action in the coming days. With travel portals now offering a host of new services – putting forth their travel packages and providing safer mode of payments – booking travel online is no more confined to getting a low-cost airline ticket. In fact, these portals are now becoming travel guides rather than just ticketing stations. As per comScore’s data for April 2011, the number of visitors to travel sites in India increased 32% compared to last year. The study by the US-based digital market research company revealed that around 18.5 million visitors (age 15 or older visited) turned to the Internet for their travel needs in April 2011. While Indian Railways led the list of the top 10 visited sites, registering 8.4 million visitors this year (an increase of 8% from the previous year), Online Travel Agency sites (OTAs) secured the remainder of the four top spots in the category. MakeMyTrip reached nearly 3.9 million visitors (up 63%) followed by Yatra Online with 3.5 million visitors (up 82%) and ClearTrip.com with more than 2.1 million visitors (up 80%). Interestingly, the US-based Expedia Inc. secured the #5 position with 1.8 million visitors (up 12%).

This clearly indicates that there is a distinct shift in consumer preference as more and more people now prefer to plan and book their travel, and holiday needs online. According to travel industry research company PhoCusWright, India’s online travel market is the fastest-growing online travel market in the Asia Pacific region. What’s more? The company expects the Indian online travel industry to grow at a whopping 28% rate to top $7 billion by 2012. And it’s because of this reason that OTAs are now exploring newer avenues to generate revenues. In fact, revenue from advertising has already taken a backseat, and the focus now is more on cross selling of products, combination of products, et al. Further, with the rise in the sales of non-air products, industry players are confident that newer product categories will be explored in the travel and holiday space.

The increased pumping of money in the sector has also helped portals spend more to attract customers. In the last couple of years, most of the sites broke-even, securing a comfortable position. For instance, Nasdaq-listed MakeMyTrip registered a profit of $3.7 million in Q4 FY2011 as compared to a loss of $1.3 million in the same period last year. Even for the financial year ending March 2011, it had a profit of $4.8 million as against a loss of $6.2 million in FY 2010.


Source : IIPM Editorial, 2012.
An Initiative of IIPM, Malay Chaudhuri
 
For More IIPM Info, Visit below mentioned IIPM articles
 
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Friday, April 12, 2013

B&E Indicators

Global AUM recovered further in 2010

Overall, 2010 was a better year for asset managers than 2009, confirming the rebound from the global financial crisis. Assets under management (AUM) continued to grow and profitability improved, easing some of the pressure on industry participants. In 2010, the global value of professionally managed assets rose by 8% to $56.4 trillion from $52.4 trillion in 2009. In fact, global AUM surpassed the previous year-end high of $56.2 trillion achieved in 2007. Still, there was wide regional variation in AUM expansion in 2010. While Latin America, with an increase of 18%, posted the strongest growth, AUM in North America rose by 8%. AUM in Europe too rose by 7%, but with considerable variation across countries. However, Japan and Australia, the two largest markets in the Asia-Pacific region, posted a combined AUM increase of just 2% in 2010. In emerging markets other than Latin America, AUM rose by 10% in South Africa and the Middle East (combined) and 11% in Asia (excluding Japan and Australia), certainly less rapidly than in the pre-crisis years.


Source : IIPM Editorial, 2012.
An Initiative of IIPM, Malay Chaudhuri
 
For More IIPM Info, Visit below mentioned IIPM articles
 
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Sunday, April 7, 2013

B&E Indicators

Signs of recovery

While the global private equity (PE) industry in 2010 may not have recovered at the rate that was expected, there were signs that the industry within the Middle Eastern and North African (MENA) region may be on the road to recovery. Reason: The year 2010 saw an increase in funds raised, from $1.1 billion in 2009 to $1.4 billion, indicating that investors continue to see considerable value in the region.

Raising capital remains a challenge
Although cumulative funds under management grew to $22.4 billion in 2010, raising capital continued to be a challenge for fund managers. In fact, 2010 saw just nine funds successfully raise capital totalling $1.4 billion in contrast to the industry peak in 2007 & 2008. Moreover, of the new funds announced in 2010, eight raised capital totalling $1.3 billion while one fund, announced in 2008, raised an additional $57 million.


Source : IIPM Editorial, 2012.
An Initiative of IIPM, Malay Chaudhuri
For More IIPM Info, Visit below mentioned IIPM articles

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Monday, April 1, 2013

B&E This Fortnight

INTERNATIONALBUSINESS, ECONOMY & FINANCE

Riding with Germans
While rivals Hewlett-Packard and Dell made headlines in the acquisitions market last year, the Chinese computer giant Lenovo is making some big ticket bids of its own this year. Four months earlier Lenovo signed a strategically positioned JV with NEC Corp to sell laptops in Japan. The company is now all set to buy Germany’s Medion AG in a deal that values the consumer electronics company at $671 million. The deal is expected to double the market share to more than 14% of the PC market in Germany, which is Europe’s biggest economy today and give the combined company a share of around 7.5% in the western European PC market. Hewlett-Packard accounted for 17.6% of the global PC market last quarter, declining from 18% a year earlier, Taipei-based Acer dropped to 12.9% from 14.6% and Lenovo, the fourth largest, increased its share to 9.7% from 8.2%. In the past year, HP made over $7 billion in acquisitions and for its part, Dell bought IT consulting firm Perot Systems for $3.9 billion in 2009, and more recently, Boomi, a cloud computing integration service, for an undisclosed sum. Lenovo shares fell by 3% on the announcement amidst concerns of investing in a slow growing market like Germany. In addition competitors like Dell and HP are moving into the high margin consulting business, while Lenovo is still stuck in hardware.

Ford’s Smallest
Automobile companies are bracing themselves for the rising costs of transportation. Ford Motors, the world’s No. 4 auto maker is developing its smallest engine ever to squeeze out greater fuel savings. The new EcoBoost, a three cylindrical engine, is designed to have a higher fuel economy without sacrificing power & performance. The engine should be available in 90% of Ford’s vehicles in North America by 2013. The company’s profits of $6.6 billion in 2010 have indicated a long awaited rebound as Ford lost $14.6 billion in 2008.

Pandora raises IPO
The music streaming superstar Pandora has dominated the headlines with its announcement of a public offering, which would help them to raise $142 million; announcing a target price range of $7 to $9 per share price. Pandora, which tops the list in terms of music experiences, has recorded a revenue of $43 million during the first quarter by averaging a new user every second with a list of 90 million registered users. Pandora expects to raise $96 million to $142 million.


Source : IIPM Editorial, 2012.
An Initiative of IIPM, Malay Chaudhuri
and Arindam Chaudhuri (Renowned Management Guru and Economist). For More IIPM Info, Visit below mentioned IIPM articles
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